The company has 4 manufacturing facilities - at Lote in Maharashtra, Bawal in Haryana, Jainpur in U.P. and the latest state-of-the-art plant at Hosur in Tamil Nadu. The geographical set up of the plants has been advantageous in providing high service levels and supply chain efficiency. Recently the company inaugurated its new emulsion plant at Jainpur and new polyester resin plant at Lote.

The company has over the years developed a variety of products in order to meet customer demand in the Decorative, Automotive, Auto Refinish, Performance Coating and Powder Coating segments of the market.

March 2016 quarter results

In quarter ended March 2016, sales grew 10% to Rs 891.07 crore. OPM jumped 260 basis points to 14.9% which saw OP growing 34% to Rs 132.90 crore. Most of the company's raw materials are crude oil-based and their prices have fallen in the past few months. This has boosted OPM.

Other income grew 10% to Rs 6.38 crore and interest cost was NIL.

As depreciation grew 2% to Rs 17.10 crore, PBT grew 38% to Rs 122.18 crore.

EO gain was Rs 535.34 crore against NIL. Thus PBT after EO grew 645% to Rs 657.52 crore.

During the quarter the company sold its land Perungudi fixed assets for a consideration of Rs 537.86 crore. The profit of Rs 535.34 crore is shown as EO items.

After providing for taxation (up 50% to Rs 41.75 crore), PAT jumped 920% to Rs 615.77 crore.

FY 2016 results

In FY 2016, sales grew 8% to Rs 4289.85 crore. OPM jumped 240 basis points to 14.9% which saw OP growing 29% to Rs 572.32 crore.

Other income grew 14% to Rs 24.84 crore and interest cost was NIL.

As depreciation stagnated at Rs 67.79 crore, PBT grew 33% to Rs 529.37 crore.

EO gain was Rs 535.34 crore against NIL. Thus PBT after EO grew 167% to Rs 1064.71 crore.

After providing for taxation (up 36% to Rs 173.61 crore), PAT jumped 228% to Rs 891.10 crore.

Enjoys strong parent support

The continued technology focus from the parent Kansai Paint Co. Ltd. (which holds 69.27% stake in the company), Japan has helped bring the latest technology products. Based on the excellent track record and new technology offerings, Multiple New OEM Business have been awarded for future business prospects. In addition the company's state-of-the-art Hosur plant is now fully operational and has been approved as a factory of supply by Industrial customers as well.

The company is a leader in Industrial Paints

Kansai Nerolac is the leader in the Industrial Coatings market space and it continues to increase its market share in this space. It has extended its close interaction with customers to the areas of Performance coatings which has helped it increase its market share. The company now serves a vast array of OEM industries with a variety of products.

Complete system capability with advanced technological products introduced over the years has been instrumental in sustaining the leadership for industrial business segment. KNPL has always launched products for customers across various market segments which are innovative and technologically superior.

The industrial team has undertaken the initiative of "Train the customers". The team imparted training, gave colour presentations and also suggested many improvement areas related to painting and safety to Multiple OEMs and Auto ancillaries.

Made inroads in Railways business for coaches and wagons

The company made inroads in Railways business for coaches and wagons. In Performance Coatings Segment, New business and new products were the focus. The company continues to focus on gaining approvals from large buyers of paint. New products like Direct to metal coatings for Industrial application have been introduced. The Company launched Floor Coatings Products during the year with favourable response.

Enhancing its market leadership

The company has enhanced its market leadership by entering into a long term technical collaboration with Protech Oxyplast of Canada for Powder Coatings. Protech Oxyplast is a leading global player in the powder coating space. The collaboration will help KNPL to bring numerous new technologies in powder coatings to the Indian market.

To set up new plants

Board of Directors of the company at its meeting held in May 2015, approved setting up of a paint manufacturing unit at Sayakha Industrial Estate in Gujarat having capacity of 42000 MT / year, which is expandable in phases, at an estimated cost of Rs 350 crore.

The company will also set up a paint manufacturing unit at Goindwal Sahib near Amritsar in Punjab having capacity of 38000 MT per year, which is expandable in phases, at an estimated cost of Rs. 180.50 crore.

It will also set up a Global R & D Centre at Vashi, Navi Mumbai, at an estimated cost of Rs. 40 crore..

Valuation

The share price trades at Rs 298.